What is the US30?
US30 is a common ticker name for the Dow Jones Industrial Average (DJIA). The DJIA is a major stock average in the USA which is always composed of 30 publicly traded companies listed on US stock exchanges.
The DJIA has been around for a long time. It was first created as an indicator to gauge the state of the American stock market in the late 19th century. However, it has been somewhat overtaken by broader, more modern stock indices such as the S&P 500 and the NASDAQ 100 indices. In particular, the S&P 500 Index has taken the DJIA’s old role as the barometer of the American stock market.
The DJIA is price weighted, unlike modern stock indices, which are weighted by market capitalisation.
The DJIA’s member companies are typically old “blue chip” companies which are involved in industrial processes, and as such, is somewhat less relevant to the modern American economy, which has become increasingly service based since the 1960s.
What Is One Pip Change in US30?
A pip change is the measurement used for change amounts within an exchange rate of a currency pair. It’s calculated from the last decimal point. Most major currency pairs are priced to within four decimal places, so the smallest change could be 1/100 or one percent (0.0001), which is one basis point.
However, currency crosses for the Japanese Yen (EUR/JPY) have a pip of 0.01. For metals like silver and gold, a pip is 0.01 on the US30.
Here’s an example: the GBP/USD moves from 1.3935 to 1.3936, so there is one pip change. If you’re using a five-digit broker and the GBP/USD moves from 1.39355 to 1.39360, there’s a half a pip change (0.5 pip).
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How to Measure Pips in BTC/USD on US30
When measuring pips for BTC/USD pairs on the US30, it’s similar to when you’re trading gold - XAU/USD. Bitcoin doesn’t have a fixed value per pip because of how much it fluctuates. Therefore, it depends on how many BTC units are in the 1.00 lot.
Generally, you would need to know the exchange rate and should be able to measure pips similarly using the calculation below.
For example, you have a 1 BTC volume, and one pip equals 0.1 USD. That means for every $1 movement of BTC/USD, there are 10 pips. Likewise, if there are 10 BTC, one pip would be the BTC amount multiplied by the pip amount (10x0.1).
How to Calculate Pips for US30
The pip values are always constant when the trading currency is USD. However, if you’re trading other currencies, such as GBP or EUR, the pip values will vary based on the current market rates for GBP/USD or EUR/USD.
You can calculate pips manually when trading in other currencies and for all lot sizes. The formula is:
- Pip value equals the pip size divided by the exchange rate multiplied by the position size.
For instance, you want to calculate your pip value for GBP trading with a position size of one lot (100,000 currency units) for a GBP/USD cross, which is currently trading at the 1.3935 mark. With that information, you use the formula above to show:
- Pip value equals (0.0001/1.3935) multiplied by 100,000 to give you £7.18
How to Count Pips in US30
To count the pips on US30, you have to remember that there’s a 0.1 difference in price for one pip. Therefore, a price gain on US30 from 25000.00 to 2500.10 is considered a one-pip difference. Also, if you add 15 pips to the 25000.00 US30 price, you will receive 2501.5.
Generally, it’s easier to use a pip calculator for this because it’s so much simpler. You choose the instrument, which for these purposes is US30. Select the pip amount you want, the deposit currency you’re using, and the trade size or units. This easily tells you the pip size.
One pip for one unit of USD would be 0.01. However, one pip for one unit for XAG (Gold) would be 0.000434 because gold’s price is 23.02397 currently.
Conclusion
Though it’s possible to count and measure pips on the US30, it’s generally wise to use a pip calculator to do the work for you. A seemingly minor mistake could cost you a lot of money on the stock market, and it’s better to use automation whenever you can.
